Accounts Receivable Intelligence Platform
Client Profile
Industry: Healthcare Technology Services
Size: $950M annual revenue, 8,500+ clients
Challenge: High DSO and increasing bad debt write-offs
Business Challenge
A healthcare technology company was struggling with accounts receivable management:
- DSO averaging 68 days vs. industry benchmark of 40 days
- Bad debt write-offs at 3.1% of revenue annually
- Manual collection processes with inconsistent follow-up
- Poor visibility into customer payment behavior patterns
- Inefficient resource allocation across collection activities
Advanced Analytics Solution
We implemented a comprehensive AR Intelligence Platform using advanced predictive analytics:
1. Predictive Payment Modeling
- Models predicting payment timing with 90+ variables:
- Customer payment history and patterns
- Invoice characteristics and amounts
- Industry-specific payment behaviors
- Macroeconomic indicators affecting customer segments
- Early warning system for payment default risk
2. Dynamic Collection Optimization
- Customer scoring for prioritization of collection efforts
- Optimal timing models for collection activities
- Channel optimization (email, phone, portal) based on customer response patterns
3. Personalized Communication Engine
- Recommend communication terms for optimal and proactive message content
- Measurement framework for communication effectiveness
- Automated escalation pathways based on customer response predictions
- Multi-channel orchestration with timing optimization
4. Performance Analytics
- Real-time dashboards tracking collection KPIs
- Attribution analysis for collection strategy effectiveness
- Predictive analytics for working capital optimization
- Customer payment behavior segmentation and insights
Implementation Approach
- Data integration: ERP, CRM, and payment system integration (5-10 weeks)
- Model development: Predictive algorithms and testing (8-12 weeks)
- Process redesign: Collection workflow optimization (6-10 weeks)
- Full deployment: Organization-wide rollout (10-14 weeks)
Results After Implementation
- 24-day reduction in average DSO (from 68 to 44 days)
- $100M working capital released from improved collections
- 50% reduction in bad debt (from 3% to 1.5% of revenue)
- 40% improvement in collection team productivity
- $10M annual benefit from reduced financing costs and write-offs
Key Insights and Outcomes
- ML-AI models achieved 85-90% accuracy in predicting payment within 30 days
- Customer segmentation revealed distinct payment behavior patterns requiring tailored approaches
- Targeted communication increased response rates by 20-30%